The multiplier effect applies to any
A. change in autonomous consumption but not autonomous investment.
B. change in both autonomous consumption and autonomous investment.
C. change in autonomous investment but not autonomous consumption.
D. change in any source of spending other than consumption and investment.
Answer: B
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Which of the following would be most likely to induce Congress and the president to conduct contractionary fiscal policy? A significant
A) decrease in oil prices. B) increase in labor productivity. C) increase in inflation. D) decrease in real GDP.
Indifference curves on the same indifference map can have different shapes
Indicate whether the statement is true or false
To achieve allocative efficiency, firms
a. strive to minimize fixed costs b. strive to maximize profits c. produce at their minimum long-run average cost d. produce at their minimum long-run marginal cost e. produce the output consumers want most
Market failure implies that
a. in the real word, the market fails to achieve equilibrium b. with an unequal distribution of income, the market will fail to provide sufficient goods to the poor c. when externalities are present, the market will fail to provide the socially optimal price and output d. negative externalities are greater than positive externalities so that the market fails to create an efficient outcome e. the inability of the market to solve the problem of unnecessary demand is caused by persuasive advertising